'Hot Button' Climate Issue Spotlights How U.S. Chamber Sets Policy

U.S. Chamber of Commerce staff decides the trade group's climate and energy policy positions without approval from the board of directors, Nike Inc. charged as it formulated a plan to call for greater chamber openness.

Nike, which last week left the chamber's board of directors but decided to remain a chamber member, described a lack of transparency at the group that conflicts with how the chamber describes its operations. Beaverton, Ore.-based Nike said it is determined to work for changes in the group.

"We just weren't clear in how decisions on climate and energy were being made," said Brad Figel, Nike's director of government relations. "They're not being made at the board-of-director level, because we're a member of the board of directors. We were not consulted. We're convinced that's not really where the action on climate change is being made."

The chamber reaches its positions through a "democratic process" that is "driven by members," chamber spokesman Eric Wohlschlegel said yesterday.

Questions about how the chamber decides its legislative positions come as some companies have been leaving the well-heeled trade group over how it handles lobbying on federal climate policy. A widening, albeit small, group of businesses has departed, citing a difference of opinion over not just policy but rhetoric used by business' biggest lobbying arm.

Apple Inc. left yesterday via a letter to chamber President Tom Donohue that said "we strongly object to the Chamber's recent comments opposing the EPA's efforts to limit greenhouse gases." The chamber in August filed paperwork asking U.S. EPA to hold a public debate on climate change science, as the agency prepared to regulate greenhouse gas emissions under the Clean Air Act.

Energy companies Chicago-based Exelon Corp., California-based Pacific Gas & Electric Co. and New Mexico-based PNM Resources Inc. in the last few weeks decided not to renew chamber memberships. All three stand to benefit from the House bill on climate that passed in June. Each has invested in renewable energy, has large amounts of nuclear power, or both.

There have been earlier departures over climate, as well. PSE&G, a company with a New Jersey-based utility, left about a year ago. The company has a growing renewable-energy business as well as nuclear, coal and natural gas generation. About half the power it delivers comes from nuclear energy. Levi Strauss & Co. said it left in 2001, with disagreement over climate legislation one of the key reasons.

Scrutiny of the chamber is likely to continue. About a dozen other companies are talking about joining Nike's planned call for more chamber transparency, said a representative of a technology company who asked not to be identified because the group is not yet formal.

Among the questions for the chamber, the technology company representative said, is "how do they deal with the issue of climate change and hear all of the different perspectives?"

The internal strife at the chamber and questions about its operations underscore the difficulty the biggest business trade group has in satisfying members with diverse and often conflicting financial interests, analysts said. The chamber said it has about 3 million members.

"Basically, they're simply responding to the majority of their businesses' expressed needs," said Kenneth Green, resident scholar at the American Enterprise Institute. "They're a membership-driven organization. You have to figure that the majority have said, 'I come up a loser under this stuff.'"

The flurry of exits and Nike's questions about the board of directors, however, throw a spotlight on how trade groups make decisions. While some boards of directors are more active than others, there are some commonalities in how industry groups formulate policy positions, Green said.

"Generally speaking," Green said, "what you have is a charismatic leader who makes the policy decisions, probably based on the policy recommendations of staff ... and a board that is mostly ceremonial."

Green added, "When you have a board that's less engaged, decision making happens at the level of the executive director. It works pretty well unless you hit a hot-button item."